According to bankers, there would be lot of unapplied interest that would have accumulated on the account.

Beleaguered business tycoon from Karnataka Vijay Mallya has offered to settle bank dues by selling some of his assets and sought permission from the Karnataka High Court.

"UBHL and myself have filed an application before the Karnataka High Court on June 22, 2018, setting out available assets of approximately Rs Rs 13,900 crore. We have requested the Courts permission to allow us to sell these assets under judicial supervision and repay creditors, including the Public Sector Banks such amounts as may be directed and determined by the Court," Mallya said in a media statement.

The total offer is consists of all assets seized by various authorities amounts to Rs 13,960.31 crore.

Mallya, who left the country on March 2, 2016, and is residing in London, has sought clearance from the court to sell these assets under "judicial supervision".

However, Enforcement Directorate (ED) has already seized these properties of Mallya and the court has asked the law enforcement agency to look into this offering, according to Uday Holla, a lawyer associated with the case..

But, ED, according to Mallya, has objected to any such settlement, in the court.

"The surprising fact is that the ED have objected in Court to my Group’s applications for sale of assets in order to allow me to repay creditors, including Public Sector banks," Mallya says in the letter.

Asset Recovery head of one of the banks in the consortium told DH on condition of anonymity, "Ideally we would want the cost of funds to be recovered -- which right now stands at 8% roughly. There has been a lot of unapplied interest associated with the account. But that said, in the given scenario, most banks would be happy with the principal amount itself. Also, SBI, being the leader of the consortium will have substantial say in the case."

The principal amount that KFA owes to the banks is between Rs 4,500 crore to Rs 5,000 crore, a banker, who is familiar with the deal said on condition of anonymity.

Banks had previously turned down Mallya's offer to repay Rs 6,868 crore in April 2016. The total dues at that time were in excess of Rs 9,000 crore, including interest.

According to the banking industry sources associated with the case, Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (Sarfaesi) provides for such kind of settlements. "Sarfaesi leaves it to the wisdom of the banker on such settlement," the source said.

In the letter, he has blamed Central Bureau of Investigation (CBI) and Enforcement Directorate of hounding him. "I am tired of this relentless pursuit of me by the Government and its "criminal agencies". All my efforts are either ignored or misunderstood," he said.

Vijay Mallya's letter addressed to PM Modi on April 15, 2016

In a tirade of charges against both CBI and ED, Mallya concludes, "If the criminal agencies such as ED or CBI object to my proposal, and object to the sale of assets, it will clearly demonstrate that there is an agenda against me beyond recovery of dues to Public Sector Banks."

Enforcement Directorate (ED), last week, moved court against Mallya seeking to declare him a “fugitive offender” and to confiscate his assets worth Rs 12,500 crore.

The request is part of the second charge sheet filed in the alleged money laundering case in the Kingfisher Airlines Ltd (KFA) loan default of over Rs 9,000 crore.

Back on April 15, 2016, Mallya had written to both Prime Minister Narendra Modi and then Finance Minister Arun Jaitley, blaming the United Progressive Alliance (UPA) for the failure of his Kingfisher Airlines. Copies of those letters have been released to the media on Tuesday by his company officials in Bengaluru.

Timeline

Liquor baron Vijay Mallya on Tuesday offered to settle lenders’ dues amounting to Rs 9,000 crore. Mallya, who is now residing in London, has filed a petition in the Karnataka High Court seeking permission to sell off his assets and repay the loan. Here is a timeline:

2005: In May 2005 Chairman of the United Breweries (Holdings) Limited Vijay Mallya sets up Kingfisher Airlines (KFA).

2006: KFA approaches IDBI Bank for a loan. Not having a good history with IDBI, the bank committee decides to decline Mallya’s proposal. Mallya approaches other banks for loans and succeeds.

2007: Kingfisher Airlines plans to acquire Air Deccan.

2008: Air Deccan deal is signed and United Breweries Limited pays Rs 550 crore for a 26% stake in the carrier. In March, KFA owes a debt of Rs 934 crore. In September Kingfisher Airlines goes abroad for the first time, providing flights between Bengaluru and London.

2009: The airlines now owes a debt of Rs 5,665 crore, which grows into Rs 7,000 crore. IDBI changes its mind and decides to provide a loan of Rs 900 crore to the airlines.

2010: All the banks inform the airlines that it would give nine months to pay back the loan.

2011-2012: The carrier’s licence to operate is confiscated resulting in non-payment of salaries to its employees. As of March 2016, Kingfisher Airlines owes Rs 3,000 crore to 3,000 employees in terms of salary. It owes banks such as SBI and IDBI a huge sum of $1 billion as loan.

2013: UBHL is approached for a payment of Rs 6,493 crore in loans for Kingfisher Airlines by a consortium of banks, including SBI. Mallya assures that a large portion of the loan will be settled soon.

2014: “Wilful defaulter” tag is given to Mallya by United Bank of India. Other banks like SBI and PNB follow suit.

2015: Finance Minister Arun Jaitley declares that the airlines has a debt of Rs 9,091.40 crore. In April, Mallya’s personal aircraft is sold at Rs 22 lakh by Mumbai International Airport Private Limited. The Service Tax Department holds the airlines accountable for a non-payment of Rs 115 crore. The Department approaches Bombay High Court to seize Mallya’s passport.

2016: In February, Mallya is asked by the board at United Spirits Limited to step down. In March, a consortium of banks approach Supreme Court in a plea to stop Mallya from escaping the country. Mallya however, had left the country on March 2, taking refuge near London. A special magistrate court issues a non-bailable arrest warrant (NBW) against Mallya for not appearing in court for a slew of pending cases. In April, ED approaches a special court in Mumbai to issue another non-bailable arrest warrant under the Prevention of Money Laundering Act, 2002. The court goes ahead and does so. Reports surface alleging that Mallya has transferred $590 million abroad.

2017: In March, Mallya criticises the Narendra Modi government, claiming that the Centre is “bent upon holding me guilty without fair trial.” In the same month, Ministry of External Affairs says that the UK government has conveyed India’s request for liquor baron Vijay Mallya’s extradition which was sent to UK Court. In April, Mallya’s luxury property, the iconic Kingfisher villa in Goa, is sold for Rs 73.01 crore by a consortium of banks led by the State Bank of India.

June 22, 2018: The government of India made its first move to clampdown on big bank loan defaulters under a new law as the Enforcement Directorate (ED) moved court against liquor baron Vijay Mallya seeking to declare him a ‘fugitive offender’ and to confiscate his assets worth Rs 12,500 crore.

June 26, 2018: Vijay Mallya informs media houses that he is willing to settle all his dues by selling part of his assets.

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